Legal documents state that the fraud investigation against Sam Bankman-Fried (SBF), Former FTX CEO, might take “months or years.” However, the filings do state that the delay would only occur if additional charges are added. Following his arrest in December and subsequent extradition from the Bahamas, SBF is currently out on bail. In regards to allegations including wire fraud and money laundering, he has entered a not-guilty plea.
Lawyers contend that additional accusations brought by the U.S. Department of Justice following the extradition may be in violation of the agreement between the U.S. and the Bahamas. It also mentioned Bankman-Fried’s right to challenge any attempt to have them included in foreign courts.
Other details in the FTX filing
As per the legal filings, SBF “is currently challenging the Government’s new application for consent in The Bahamas.” The filing further stated that “such proceedings may well take many months, even years to be litigated.”
A recent move by the U.S. Supreme Court has given the defense case more confidence. In a May case involving bids for state contracts, the court limited the applicability of federal fraud provisions. Arguments that SBF misled a bank and his hedge fund investors of Alameda Research are undermined by this situation and other cases. His attorneys contend that while the firm is being wound up, the parties could still receive their money back.
Supreme Court’s decision in May stated that “Bank-1’s right to control access to its bank accounts is no longer a valid property right.” This dismisses claims that SBF misrepresented the purpose of a bank account put up for his company North Dimension.
As per the filing, “The Alameda lenders were not deprived of their contractual rights to collect the existing loans.”
The FTX collapse was one of the most significant financial disasters over the past decade. It is interesting to note that while the U.S. SEC (Securities and Exchange Commission) has filed lawsuits against Binance and Coinbase for the alleged sale of unregistered securities, the body has not filed anything against FTX.